If quantity demanded rises only slightly following a moderate price cut,then demand is:
A) Elastic.
B) Inelastic.
C) Unitary elastic.
D) Abnormal.

Question

Quizplus · Accepted Answer

If a moderate price cut results in only a slight increase in the quantity demanded, it suggests that the demand is relatively unresponsive to changes in price. This indicates that demand is inelastic. Inelastic demand occurs when changes in price have a proportionally smaller effect on the quantity demanded.

If Quantity Demanded Rises Only Slightly Following a Moderate Price